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Even before the latest federal fight over the budget and the nation’s debt came to a head
yesterday, Wall Street had been mostly dismissive of any notion that there wouldn’t be a deal.

After all, previous crises in Washington actually proved to be buying opportunities for
investors willing to sit through the market slides prompted by political brinkmanship.

Yesterday was no exception, as investors who had waited through the latest slog were rewarded
with a big rally in the stock market, boosting their 401(k) retirement funds and other investments.
Major averages such as the Standard & Poor’s 500, Dow Jones industrial average and the Nasdaq
composite were all up more than 1 percent yesterday.

Local financial planners say they had been hearing from worried clients, but most of them are
sticking to investment and savings plans.

“Should we be doing something? How is this going to affect us? Are they really going to screw
this up?” clients have been asking Gary Vawter of wealth-management firm Vawter Financial. “I get
the sense of, ‘Here we go again.’”

John Sestina, considered to be the father of the fee-only financial-planning concept, said he,
too, had clients asking about the debt crisis.

“Clients are concerned about what’s going on in Washington,” he said.

The planners say that, in general, their clients have a thick skin after all they’ve experienced
over the past dozen-plus years, including the major upheaval caused by events such as the bursting
of the tech bubble in 2000, the Sept. 11 terrorist attack and the financial crisis in 2008.

Those who have stuck it out have been rewarded.

The Dow Jones industrial average and the broader S&P 500 are both just off all-time highs.
Many other indexes are at record levels or multiyear highs, including the tech-heavy Nasdaq.

Like other planners, Sestina said investors with well-diversified portfolios and a long-term
time horizon shouldn’t worry about short-term events that they fear could upset their game plan.
Those who react emotionally to events are the ones who lose, he said.

A similar drama in Washington could play out again in several months.

“I wouldn’t panic over this,” Sestina said. “If you are properly positioned, you can weather the
storm.”

Eric Bishoff, president and CEO of Bishoff Financial Group, agrees.

“How does this event affect short-, mid- or long-term goals?” he asked when it comes to his
clients’ needs. “For the most part, it’s not going to affect any of them.”

If investment changes need to made, they should be for reasons other than volatility, such as a
client approaching retirement age, the planners said.

That doesn’t mean planners aren’t making adjustments to portfolios. The outsized stock-market
gains that clients have gotten over the past five years mean that their portfolios might be out of
balance with too much in equity investments, they said.

Bishoff said that a few months ago he began moving some of his clients’ stock-market gains into
short-term bond funds that won’t be hurt as interest rates move higher.

The planners said despite the enormous run by the stock market over the past five years, there
still is room for stocks to move higher on the back of solid corporate profits, Vawter said.

“If you’re not going to be in the equity market,” he asked, “where are you going to be?”